How to Hedge a Portfolio with Put Options

There are 2 good reasons to buy put options: because you think they are cheap because you want downside protection. In the latter case, you are looking to use the skewed payoff profile of the put option to protect a portfolio against large downside moves without capping your upside too much. The first requires a …

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Are SPX Options Expensive?

Options are non-linear financial products that allow you to do useful things that you can’t easily do with other financial instruments. Let me give a specific illustration of options being useful… The chart below shows the monthly cumulative % performance of our RW systematic trading portfolio since we started trading it in October 2018. The …

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